Blog Post

iPhone 5 values are more than ETF fees so I’m upgrading to an iPhone 5s

This morning I took an informal poll on both Twitter and Google+(s goog), asking if any iPhone 5(s aapl) owners would be upgrading to an iPhone 5s. Surprisingly, the responses were skewed towards yes and the main reason looks to be how well the iPhone 5 has held its value.

Apple iPhone 5S 3 colors

Earlier this month, we shared a post on getting the most money for your iPhone, and just to be safe at that time, I locked in $315 through Gazelle for my 16 GB iPhone 5 that uses AT&T’s(s t) network. After my poll this morning, I was able to get even more for my handset: $352 through NextWorth, using the promo code of “todaysiphone” for a 10 percent bonus. (Thanks, David!)  I was doing all this without much thought of upgrading, to be honest. It was more an exercise just in case.


Then I realized that the quoted value was much higher than my Early Termination Fee with AT&T: Essentially, I can get the same $199 pricing as a new AT&T customer by paying off my current contract. I’ll even have some money left over after I do so. Granted, I did pay $199 for the iPhone 5 less than a year ago, so paying another $199 this year isn’t what I’d call a “cheap” prospect. But it’s much cheaper than paying full price for a new iPhone 5s. If I had to do that, I’d surely skip the phone purchase.

I’m wondering if Apple discontinuing the iPhone 5 — it’s gone as of next week — has anything to do with this. Could the values be slightly higher since the handset will be scarce? Maybe, but probably not much. Instead, this speaks to how a good an investment an iPhone can be: I can think of no other phones that hold their value as well. Just to confirm that, I went back to NextWorth to compare the prices of some current flagship phones that are actually newer than the iPhone.

Got a 64 GB HTC One for AT&T? NextWorth pays $259, or $61 less than the 16 GB iPhone 5. (Note that’s without the 10 percent bonus on either phone; NextWorth is paying $320 straight up for a 16 GB iPhone 5.) The 16 GB Galaxy S 4 does much better with a value of $315 or just $5 less than an iPhone 5 with the same storage capacity. That relatively new 32 GB Lumia(s nok) 1020 with its 41-megapixel camera? It’s worth $309 to NextWorth. And a 16 GB BlackBerry(s bbry) Z10? Well, $160 is better than nothing.

Why would I upgrade from an iPhone 5 to a 5S? I’m not the average consumer, of course. I write about mobile technology for a living. So I buy various devices to get a feel for the whole smartphone market and — hopefully — to maintain perspective on what the various companies in this space are doing. Yes, I’ve written a weekend column about Android for the past 4 years, but I’ve owned most of the iPhone models, have a few Windows Phone(s msft) devices in the house and even keep a BlackBerry device on hand.

Ultimately I’m intrigued by the new A7 / M7 chip combo as the approach seems similar to what Motorola has done with the X8 chip in my Moto X. It will be interesting to see how developers take advantage of the co-processor and new APIs. The new camera also looks impressive and I like the TouchID concept as well.

iPhone touch ID

Is that worth an upgrade for most of you? I can’t decide that; it’s your money and your decision. But with the values being offered for the iPhone 5, the cost may not be as much as you’d think. And based on the poll responses I saw this morning, most respondents are planning to take advantage to cash in on their iPhone 5 investment.

22 Responses to “iPhone 5 values are more than ETF fees so I’m upgrading to an iPhone 5s”

  1. fredhstein

    Great column and comments. Thanks all.

    As fanboy and stockholder – sweet. More new 5S’s to be sold.

    The new camera – wow. Burst mode captures, true tone flash, auto image stabilization, panorama pictures, image processing on the A7 chip, slow-mo video, live zoom in video….
    Kevin, let’s see how the camera thing plays out as more people use the phone. I predict imaging will be a big deal soon for smartphones and other devices.

  2. Well, a new iPhone 5 was $400 and the apple care plus is $100. So with taxes in NY I paid 650ish. Now, I have a family plan, so I can upgrade one line (no need for mom to get a new phone since her iPhone 4 is good still). I can sell it on Craigslist for $700 minimum so I made $50. The rest goes back to pay for the phone. Say what you want about the iPhone but nothing beats it’s resell value!! Try that on a galaxy lol

  3. I locked in my trade-in at Amazon ($329 for a good-condition 16GB white iPhone 5, ATT; if it had been in “like new”, I could have scored $363).

    The comment by iLoveShrimp is disturbing, if true :-( I’ve had my iPhone 5 for 11 months, so my ETF would have been $215 ($325-(10*11)), so doing a new contract would have cost me $199+$215-$329 – only $85. By having to buy an unlocked one, it’ll be $320 ($649 – $329)…..bummer.

    • iLoveShrimp

      I am in the same boat as you. I am 12 months (end of this month) into my contract with iPhone 5. I calculated the exact same way as you and thought, I could actually make money on this deal. But when I called up AT&T customer care, they told me I won’t be eligible for new contract pricing for 90 days after I cancel my contract. However, as Kevin replied, if other carriers provide good service in your area then you can still go ahead with this deal. I say, next year, come back to AT&T doing the same thing :-)

  4. Compute devices having interactive commodity values, hello singularity. In a 3rd world country if I had a choice between a block of gold and a 4G smartphone, I’d take the smartphone.

  5. iLoveShrimp

    Here’s a bummer! AT&T won’t let you upgrade for 90 days, after you cancel your current contract. If you do so, it will restore your current contract instead. Also, you won’t be eligible for the new upgrade pricing during those 90 days.

    Source: Been there, done that.

    • Good point! Luckily, I have good service from all four major carriers in my area. So AT&T can’t stop me from porting my number to Verizon, for example, getting a $199 iPhone and paying off the ETF with the iPhone 5.

      Or I could — even though it will cost a little more — buy an unlocked $649 iPhone from Apple and not even worry about the ETF.

        • Oh, I love the pre-paid deals. They work great for me, BUT, they don’t work great for my family. With 4 smartphones, a family shared plan was the way to go. I could have stayed on pre-paid myself, but we get more benefits by putting the 4th line on the family plan.